Business
Adoption of IFRS
Adoption of IFRS.
About this update from Europa Oil & Gas (holdings) Plc
[{"type":"text","content":"\n \nEuropa Oil & Gas - Adoption of IFRS\n\nEuropa Oil & Gas (Holdings) plc (\"Europa Oil & Gas\") today\nannounces that it has completed its preparations to adopt International\nFinancial Reporting Standards (IFRS).\n\nEuropa Oil & Gas will prepare consolidated financial statements\nusing the recognition and measurement principles of IFRS from 1 August 2007.\n\nThe first results produced under IFRS will be for the 6 months to\n31 January 2008 and the first set of financial statements will be for the year\nto 31 July 2008.\n\nThis announcement provides reconciliations for the year to 31 July\n2007 and highlights the impact of IFRS on the presentation of the group's\nconsolidated financial statements.\n\nThe figures detailed in this announcement are based on the IFRS\nexpected to be applicable as at 31 July 2008 and the interpretation of those\nstandards.\n\nIFRS are subject to possible amendment by and interpretative\nguidance from the International Accounting Standards Board as well as ongoing\nreview and endorsement by the EU and are, therefore, still subject to change.\n\nIt is therefore possible that these figures may require amendment\nbefore their inclusion in the IFRS financial statements for the year to 31\nJuly 2008.\n\nImpact of IFRS\n\nThe main impacts of implementing IFRS with respect to the group's\nconsolidated financial statements are:\n\nPre-licence costs\n\nUnder UK GAAP some pre-licence costs were capitalised as intangible\nassets. IFRS 6 - Exploration for and evaluation of mineral resources -\nprecludes the capitalisation of expenditure incurred before an entity has\nobtained the legal rights to explore a specific area. Under IFRS, these\npre-licence costs amounting to £212,000 at 31 July 2007 (31 January 2007:\n£151,000 and 31 July 2006: £133,000) have been expensed as \"other operating\nexpenses\" or adjusted against retained earnings at 1 August 2006, as\nappropriate.\n\nInventories\n\nUnder UK GAAP inventories of oil and gas in tanks were recognised\nat estimated net realisable value with any gains or losses being taken as a\nprofit or loss to the income statement. This was considered acceptable under\nthe Statement of Recommended Practice (SORP) - Accounting for oil and gas\nexploration, development, production and decommissioning activities - issued\nby the UK Oil Industry Accounting C...